Chinese tech leaders worry about lagging behind the United States by five generations as democratic countries impose stricter regulations.

China’s Microchip Companies Fear Falling Behind U.S. Rivals

China’s microchip companies are facing a major setback due to President Joe Biden’s export controls on semiconductor technology. Chinese executives are⁤ concerned that these restrictions could push ⁢them “at least ‍five generations behind” their U.S. ​counterparts.

“The U.S.’s true intention … [is] to fix China’s chipmaking on 28-nanometre, at least ​five generations behind the ⁤global‍ leading edge of 3-nm to 14-nm,” Gerald Yin, ⁤the CEO ⁤of Advanced Micro-Fabrication Equipment, China, or AMEC, told a trade ⁤industry conference this ⁢week, according to the​ South China⁣ Morning Post.⁣ “We can’t accept [this].”

Export Controls and ‌Growing Distrust

This anxiety stems from the export control restrictions unveiled by U.S. officials last October. The Commerce Department⁤ published new rules that limit Chinese access to U.S. semiconductors. These regulations were reinforced by a pact with ⁢Japan and the Netherlands, who dominate the market for ⁤semiconductor manufacturing equipment. The growing distrust between U.S. and Chinese officials has fueled intense technology competition.

Chinese executives believe that the United States is motivated‍ by a desire to ⁤maintain its hegemony and prevent the⁤ development and revitalization of China and other emerging countries. This has led to accusations of unfair competition and unilateral protectionism against China.

Regional Concerns and Foreign Interference

Skepticism regarding China’s posture has spread throughout ⁣the​ region, ​with officials often citing Beijing’s‍ behavior to explain their security-minded posture. New Zealand, a member of the Five ​Eyes ‍intelligence-sharing bloc, recently published an intelligence report ‍highlighting Chinese strategy and espionage.

“PRC has significant and growing intelligence and security capabilities, and its efforts are increasing⁤ New Zealand’s exposure to the ⁣consequences of strategic competition,” the New Zealand Security Intelligence Service ​declared in a new report.

The report specifically focuses on foreign ‌interference campaigns launched by China, Russia, and Iran, ⁢with a particular ​emphasis​ on targeting New Zealand’s diverse ethnic Chinese communities.

De-Risking and Diversifying

American allies are increasingly concerned about their ⁣relationship with China and are seeking to “de-risk”‌ their ⁢economic ties. The coronavirus pandemic⁤ exposed⁢ the vulnerability of supply chains concentrated in China, and Chinese General Secretary Xi Jinping’s aggressive actions in the South China Sea and towards Taiwan have raised alarm.

Secretary of State Antony Blinken emphasized the need to invest in secure, resilient supply⁢ chains and protect critical technologies. President Biden recently published⁤ a new restriction on U.S. investment in China’s technology sector, focusing on industries such‍ as artificial⁢ intelligence and quantum computing.

Reactions​ and Future Steps

While some view these ⁣measures as a step in the right direction, others ‌believe they do not go far enough. Congressional China hawks are calling for⁤ stronger action to prevent funding of the Chinese Communist Party’s‌ military buildup ⁢and human rights abuses.

Chinese ⁢officials have condemned these⁢ restrictions as economic coercion ⁤and tech bullying.​ They‌ vow to closely monitor developments ⁢and‌ protect their rights ‌and⁢ interests.

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